UK Tribunal Confirms Only Owners Can Recover Import VAT: Key Lessons from TSI Instruments Case

• The First-Tier Tax Tribunal case of TSI Instruments Ltd confirmed that only the owner of goods can recover import VAT in the UK.
• TSI Instruments Ltd, which imported customer-owned goods for repair, was denied recovery of £8.4 million in import VAT because it was not the owner.
• The Tribunal found no direct and immediate link between the import VAT and TSI’s taxable supplies, as required by EU law.
• HMRC’s guidance, clarified in 2019 and 2020, states only owners or those with the right to dispose of goods as owner can recover import VAT.
• Businesses in similar situations are advised to use Inward Processing Relief (IPR) to avoid unrecoverable import VAT.

Source: crowe.com

Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.

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